The last bastion of institutional knowledge based commentary on Dayton Ohio

Economic Development in Dayton OH

Dayton Ohio has a lot of economic development organizations and directors of our many small fiefdoms. Often, one battles another in a shell game moving jobs from one jurisdiction to another. The ideas here are ways to transcend the political boundaries and create real economic growth opportunities.

Nan Whaley plays the victim, but never had a problem accepting money for her campaign from Premier employees. She never had a problem asking them to help pay to raise the city income tax either. And now, she wonders why they are going to close Good Sam, as they build out other beds in other parts of the county.

Not that saving .25% in income tax is the driver, it’s safety. No female nurses or doctors want to drive up Salem Avenue in the middle of the night. Past the AM PM Market where gunshots are frequent.

But here’s the deal, there is nothing the city, the NAACP, the ministers or even god himself can do to keep Premier operating on that site, and frankly, people should say thanks- and good riddance.

What the city can and should do, is tell Premier that you can’t trash the facility, you can’t tear it down, until it’s been on the market for two years. Just like what happens when we close a school building. At that time, any other health care system that wants to come into the market, should have the opportunity to buy the building that Premier has never paid a dime of property tax on, and open up as competition to the duopoly of Premier and Kettering Health Network.

We should be asking The James in Columbus if they want to come to Dayton, or the Cleveland Clinic, or UC Health, or a group of private doctors who want to band together to open their own facility- one where the CEO doesn’t pay herself $4 million a year, and sit on the board of CareSource, her largest client, and set the salary of their CEO at $3 million a year.

In fact, what needs to happen is we need to stop allowing companies to claim they are non-profit or serving the public good- and being allowed to skip paying for police and fire, and roads and water, etc- while paying CEO’s astronomical salaries. If you make more than 5x your average payroll, you can’t claim to be tax exempt or non-profit. It’s time that the taxpayers stop subsidizing the CEO class.

Another test would be if you receive more than 35% of your revenue from government, pay caps are in place. No one makes more than the President (current salary is $400K a year). If you can’t live on $1000 a day in Dayton Ohio, you shouldn’t be claiming non-profit status.

Any company that hires it’s own private police force should be charged a fee, equal to the officers pay, that goes to pay an extra Dayton cop. That would be called a “licensing fee” for providing a duplicative service to a public one. The reason we don’t have independent fire departments got figured out long ago, there is no legitimate reason for private cops- just like there is none for “contractors” who are really mercenaries in war zones. Sorry, you want to be a cop- work for the government, with proper oversight.

I’m pretty sure that if Good Sam was put on the market, we’d have a third option for health care in Dayton- and that it would start a price war that would benefit us all.

I’ve been to many of these “community input” type events before. To me, they are kind of like asking a few hundred amateur house painters to get together to do the Mona Lisa.

That aside- suppose the Greene wasn’t already in existence, or the Fairfield Commons Mall, or the Dayton Mall area- or Austin Landing, and we were going to build another faux downtown, just South of the real Downtown, what would we have? Another bunch of buildings to compete with the buildings that are already under-utilized.

We know MVH needs parking. They’ve been building more and more lots, along S. Main, Warren, etc. They already have a few garages. What they really need is less people driving to work- and they’ve already tried to build housing for their employees- and it still didn’t help, much. The main reason people feel weird about having to live down here is, the only grocery store isn’t very nice. So, sure, you could put a grocery super store on 12 of the acres- but, you could also put a Trader Joe’s on Wyoming where Patterson Kennedy Elementary school sat- and people would be overjoyed.

We don’t really need a super-amazing suburban style grocery.

So, what do we need? Well, the city said no to a dog park, to a skate board park, and instead built Riverscape with a rink you can’t play hockey in. We’re building yet another concert venue- as if the Fraze and the Rose aren’t enough. We’ve got a mini-white water run, for all 1000 kayakers around.

And, UD still has huge parcels of unused land along Stewart street. Including a huge parking lot, a band practice green and some soccer fields and tennis courts. In the meantime, Brown Street has a gazillion chain food options- which get slammed at meal time- and sit idle the rest of the time- esp. in summer when the students are mostly gone.

What is needed is some synergy between Brown Street, and whatever we’re going to “plan to build” and yet- they are a big block away.

So unless you look at what’s going to happen with the Stewart street corridor- the Fairgrounds remain sort of an island.

Maybe, what needs to happen is that all of what sits off Stewart- needs to be tucked away on the Fairgrounds or by UD Arena and Welcome stadium- with a free street car to circle from the Arena to Campus and around the Hospital.

Instead of huge parking garages off smaller streets- we just should build a huge one by the highway and the stadiums- and let people take the street car to the developments? Or to work at MVH, or UD?

And, at the corner of Brown and Stewart- right next to campus- we build a 5000 seat hockey arena, with 2 sheets of ice, to accommodate all the East coast kids- and the loss of Hara. Along with a second garage there, you solve the problems of Brown Street, plus bring people in for either hockey, or smaller shows than the big arena or the Nutter Center can take.

Then at the Fairgrounds- put a dog park, a skate park, a velodrome to add on to our bike friendly city cred. Why can’t we have a big park for year round events? A huge pool, wait, didn’t we used to have one by NCR and Old River? Maybe it’s time to bring one back?

Building more shopping, or housing, isn’t really going to add anything to our mix. Solving some of the circulation and entertainment misses in our community could make a huge impact.

I’m going to be there- only to ask that we don’t look at the Fairgrounds as an island- because, that’s what it’s been for the last 100 years. It’s time to look at the whole area and figure out what would make Dayton a better place to live.

Every week I look at the listings of homes sold in Montgomery County and marvel, because only in Dayton can you buy a home for less than the price of a nice used car.

This doesn’t happen in surrounding communities (other than the depressed ones- Jefferson, Trotwood) . Do you wonder why?

It’s all supply and demand would be the perfect capitalists answer. But, what drives demand?

In real estate 101 they say “location, location, location” – and people choose communities based on the schools. And to some extent this is also correct. Yet, my house, bought for $14,500 in 1986 is worth close to 10x that, and a slightly larger home 2 doors down, just went for the same amount 7 years ago. It shouldn’t have sold that low, but it was a foreclosure. And, my property value dropped- not just because the price was low, but because of the cancer that moved in.

Four doors down, a house sold for $95K 3 years ago. The new couple put at least $40K into it before splitting. It sold in a day- price unknown, but for well over $125K. And my property values are sure to go up.

Yet, I didn’t change locations, and my schools still suck. My investments in my house shouldn’t penalize me with higher taxes anymore than what my neighbors do. The value will come to me, and to the community, when I sell.

How and why do the actions of others affect my property values? If I own a share of stock in 3M, does my value go up just because Apple had a great year? No. Yes, if I go to sell my car, and someone else paid X for a similar car- that’s the price- but, I’m not selling my home, I just want to live here. Why should my value change until I do something?

Simple answer- it shouldn’t. And, this constant re-valuation of real estate based on the actions of others is causing gentrification, housing bubbles, foreclosures, and a mangled economy.

The purchase price of an owner occupied home shouldn’t change until the house is sold. The same should be said of rental property. When the government steps in and raises your property value for taxation purposes, they become an uncontrollable variable in a business equation. They distort markets. They screw existing businesses and property owners when they offer tax abatement to the new guy, while the long term investor gets shafted.

And, it’s almost counterproductive to do improvements to your property, if the tax man is just going to charge you more. But, what could be worse? Your neighbor doing improvements.

Case study: Dr. Michael Ervin, shadow mayor of Dayton before he left town for Scottsdale AZ, bought a dump of a bar in the Oregon District and poured $1.6M into it. This skewed the valuation tables for his neighbors, who were thankful the bar left, but were asked to pay more for Dr. Mike’s excess. Some, couldn’t pay the additional taxes and were forced to sell or move. Others might have spent more on a crappy house, because Dr. Mike did what he did. The market skewed. But, 10 years later, when it came time to sell, Dr. Mike got less than half his money back on his taj mahal. Yes, it’s still double the value of any of the other single family homes- and still skews things, but, the only person paying the tax on the new market rate evaluation- $725K , should be the new owner. Just as the neighbors who never left, shouldn’t have been forced to pay more when the $1.6 boondoggle went in.

The reason we pay property taxes is supposedly to support public infrastructure and government to keep our investments safe. Income taxes are supposedly a more progressive tax that are supposed to be based on ability to pay. When property taxes unfairly start to penalize people for making a long-term investment that they hoped to keep- it’s wildly unfair, un-American.

The fact that almost every office building downtown has been foreclosed on, while tenants have moved to fairer pastures funded in part by tax dollars- with more advantageous tax structures (both income and property tax) like Austin Landing is proof positive that our property taxation and income taxation hodge podge is causing more problems than it’s helping.

The value of the Kettering Tower, once the premier office space in Dayton, was decimated by Dayton’s high income tax (now 2.5%) and property taxes based on market forces beyond the owners control. Would Austin Landing have looked so good, without the huge investment in infrastructure by the county, or the income tax free zone for white collar workers (while the retail underclass pays 2%)? Probably not.

It’s time to realize that tax policy and abatement has serious consequences to the entire region, and we need to find a way to level the playing field and stop letting the choices others make, affect our tax rates.

Regional tax policy, from property to income tax, needs to be set and managed at the county level, and by fair market forces, for all of us to live within our means, and to stop changing the playing field in the middle of the game.

Other peoples money. That’s the key to real estate, and especially real estate deals managed by those we elect who are supposed to be working in our best interest.

We’ve see stupid deals in Dayton for a long time, and they seem to slide along into oblivion in the mind of the public. No one got hoisted by their petards on the Arcade deal, or the Arcade tower, or the Wayne Avenue Kroger, or…. the list gets really long.

Let’s just say this: politicians raise bad real estate deals to a new art form. And locally, there are plenty of failures. However, it would appear that the deals by the Dayton Public School Board of Education may take the cake. This is a long video. But, it should make it pretty clear that there are serious questions about the deals they’ve done, the ones they’ve refused to do- and who’s been driving the deals- and questions about his entanglements.

We look closely at the site downtown on E. First Street where Patterson Co-op once stood, a greenfield, ready for development, and the site on Wyoming at Alberta where Patterson Kennedy Elementary once stood- near Miami Valley Hospital and the University of Dayton.

We’ve spent the last two months pursuing this story- and trying to figure out why Dr. Adil Baguirov seems to be the only member of the Board of Ed- including the school superintendent, that knows what’s been going on when it comes to these deals- and we’re wondering if this is by design.

If the schools wanted to optimize the value of these vacant properties, the key factor would be what property taxes will the development generate to the district in addition to the sale price- nothing else.

Watch the video. We’ll post supporting documents later.

Here is “Dirty Deals Done Dirt Cheap” featuring the Dayton Public Schools Board of Education, the Dayton and Montgomery County Port Authority, the former DPS operations Chief John Carr, the DPS board attorney, Jyllian Bradshaw and CareSource.

It takes time and money to do videos and research like this. If you value exposing Dirty Deals Done Dirt Cheap, please consider making a donation: www.esrati.com/donate.

I grew up in Cleveland Heights, a few blocks away from Peter Benkendorf. For two Heights High grads to end up living a few blocks away from each other in Dayton 45 years later, and both involved as community advocates, is kind of amazing.

What’s not amazing, is that Peter has hijacked a community event he helped found- and taken the facebook account, the domain name, and redirected them to his new competing venture.

From his own website- “Involvement Advocacy” he describes the event:

3RD ON THIRD – DAYTON’S ECLECTIC OUTDOOR MARKET

3RD ON THIRD is an Eclectic Outdoor Market that takes place on the 3rd Sunday of the month on East Third Street in Dayton – hence the name.

A joint effort of The Collaboratory, the East Third Street Business Association and the Huffman Historic District, 3RD ON THIRD Eclectic Outdoor Market features local artists and artisans, antiques, crafts, collectibles, fair trade, clothing, jewelry, handmade items, food trucks and more.

3RD ON THIRD represents a first step in a larger strategic push to spark retail and residential development along East Third from Keowee to the intersection at Linden/Springfield and on into the Huffman Historic District, creating a diverse, vibrant, walkable and sustainable community that attracts a mix of young professionals, families, artists, and immigrants.

But, now, he’s walked away from the people on Third Street- and set up to have “Third Sundays in Dayton” at the Front Street building- a few blocks away.

Great and fine. You have your event, the people on Third Street have their event on the same day- and people stroll from one to another.

Except, Peter decided to keep the 3rdonThirdDayton.com domain, hijack the facebook page, and pretend the old event is moving and not still in business.

All I care about is the domain name, for which he has no right, or real use for. If he was truly the collaborator he claims to be:

In order to grow the Dayton region’s economic and social capital, the Collaboratory is providing the Collaborative Infrastructure—the physical space, portfolio of initiatives, engagement tools and support system for people from across the region to come together to imagine and act upon new possibilities for themselves, each other and the community, with a particular interest in downtown. These new possibilities will involve citizen, government, business, institutional, organizational and philanthropic participants and will impact how we live, work, play and learn.

You can be the pied piper of collaboration if you are truly a collaborator. If you start a community event, using an empty field to bring people together, it belongs to the community, not to one person. Mr. Benkendorf, I urge you- give up your domain name squatting, it’s not something to be proud of.